Despite plenty of potential cases, Hawaii lags in Medicaid fraud and abuse prosecutions

Hawaii has a huge population of people on Medicaid and thousands of health professionals, nursing home and care home operators taking care of them.
Published: Nov. 4, 2022 at 5:31 PM HST
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HONOLULU (HawaiiNewsNow) - Hawaii has a huge population of people on Medicaid and thousands of health professionals, nursing home and care home operators taking care of them.

But the law enforcement unit in charge of finding theft from the program and abuse of its patients has the lowest rate of charging crimes in the nation.

That’s prompted promises of improvement from the unit’s new chief.

Hawaii’s Medicaid program spends about $2.5 billion a year and the state attorney general has a 15-person Medicaid Fraud Control Unit, which looks for overbilling fraud by providers and abuse or neglect of patients.

But for various reasons, criminal cases in Hawaii are rarer than the vast majority of other states.

Hawaii Medicaid fraud and abuse prosecutions.
Hawaii Medicaid fraud and abuse prosecutions.(HNN)

In 2020, the unit’s growing caseload was 600 fraud and abuse cases, but only two people were charged with crimes and one convicted. The following year there were more cases, but just one person was charged and five convicted.

Cases frequently take more than a year to process and prosecute.

Medicaid prosecutions in other states.
Medicaid prosecutions in other states.(HNN)

Other states with similar caseloads charge more often.

In 2021, when only one person was charged in Hawaii, Pennsylvania charged 115, Mississippi charged 104. The only other state with just one criminal charge was Wyoming, where there were only 49 cases under investigation.

Deputy Attorney General Landon Murata has headed the unit for those two challenging years. He said the lack of criminal prosecution doesn’t indicate a lack of criminal and civil fraud. “The fraud is out there we just want to make sure we are doing everything we can to identify and hold people accountable for it,” Murata said.

A care home operator who submitted multiple fraudulent claims was sentenced to 6 mos. in prison...
A care home operator who submitted multiple fraudulent claims was sentenced to 6 mos. in prison and to pay restitution.(Monet Sadural | HNN)

One of those convicted last year was care home operator Ginalyn Paguirigan, who admitted she electronically submitted multiple false claims about her Medicaid clients.

She was sentenced to six months in prison and ordered to pay over 850 thousand dollars in restitution.

State Rep. Ryan Yamane, whose Health and Human Services Committee oversees Medicaid, said criminal prosecution like that is key to deterring fraud. “It’s the patients and the community that loses and in order to stop that we need prosecutions and successful convictions,” Yamane said.

Murata said when he took over the unit was down one investigator and one prosecutor, positions now filled. He is also instituting new training and processes with a mandate and support from the federal and state adminstrations.

“That’s all going to take time,” Murata said. “It’s all more than we have done in the past and it’s stuff that the unit historically has not been used to doing has not been trained to do.

“We are building it up. there is stuff in the pipe its coming if I could talk to you about I would but I can’t.”

Murata said all cases under investigation are confidential.

Another major reason prosecutions are lagging was COVID, which shut down Hawaii courts and Medicaid facilities.

“The pandemic had dramatic effect on our ability to gather evidence, interview witnesses, obtain records,” Murata said. “A lot of these places we were going to find evidence were shut down. The Department of health was going into a lot of these care homes with full PPE which we didn’t have that for our investigators.”

A former chief of the unit told Hawaii News Now that another issue holding back prosecutions was lack of cooperation from federal law enforcement agencies. He said other states may have had better relationships with their federal partners.

Murata adds the caseload has been inflated by new processes and regulations.

“Increasing caseload from both of those areas did not come with a corresponding increase in resources,” Murata said, adding that he’s not asking for more.

“You are already questioning our productivity, so before I go asking for more resources, we have to start showing more results and that’s what our goal is.”

Yamane said the state must do better to protect Medicaid patients and the taxpayers.

“If they need more resources to be able to go to court hearings and be successful then we need to be sure we add that to them,” Yamane said.

Medicaid is primarily funded by the federal government, with a percentage matched from the state treasury.